Elizabeth Warren pretty proud of her bill that would put large corporations under federal control

Kudos to the Wall Street Journal for publishing this, not because it’s a good idea, but because the American public in general and the business community in particular should understand the thinking of some of the people who are trying to worm their way into the White House.

Elizabeth Warren hates the corporations, and for the most part hates the entire private sector except to the extent it hands over money to the government and to left-wing causes. She hates the fact that they seek prosperity via the free market and don’t answer to politicians, preferring to make their customers the bosses.

The Accountable Capitalism Act restores the idea that giant American corporations should look out for American interests. Corporations with more than $1 billion in annual revenue would be required to get a federal corporate charter. The new charter requires corporate directors to consider the interests of all major corporate stakeholders—not only shareholders—in company decisions. Shareholders could sue if they believed directors weren’t fulfilling those obligations.

This approach follows the “benefit corporation” model, which gives businesses fiduciary responsibilities beyond their shareholders. Thirty-four states already authorize benefit corporations. And successful companies such as Patagonia and Kickstarter have embraced this role.

My bill also would give workers a stronger voice in corporate decision-making at large companies. Employees would elect at least 40% of directors. At least 75% of directors and shareholders would need to approve before a corporation could make any political expenditures. To address self-serving financial incentives in corporate management, directors and officers would not be allowed to sell company shares within five years of receiving them—or within three years of a company stock buyback.

Needless to say, this is a recipe for political and bureaucratic control over corporations. By mandating the 40 percent of a company’s board has to be elected by employees, you take considerable authority out of the hands of those who actually own the company and put their capital at risk to see it operate. By mandating that 75 percent of directors and shareholders approve of political expenditures, you achieve a sneaky little way of neutering Citizens United and make it virtually impossible for large corporations to have a say in the political process.

And by opening up companies for lawsuits whenever some so-called stakeholder doesn’t think the company is considering its interests, you put the courts and regulatory bodies in charge of a corporation’s day-to-day decisions. And that’s of course the idea. It drives Democrats crazy that corporate executives can make decisions without checking with them, and Warren’s bill seeks to end that.

Here’s what Warren and other liberals continue to not understand about business: When a company seeks to maximize shareholder value, they’re not doing it at the expense of the public good. The only way to maximize shareholder value is by bringing to the market products and services that people want or need, and a price they’re willing to pay. You have to serve the public before the public will reward you with its money.

Liberals don’t get this because they don’t think corporations serve the public by selling them excellent refrigerators or sewer pipes or fire logs. Liberals think serving the public means donating the Planned Parenthood and Democratic candidates for office, and paying up the wazoo in taxes. If Warren’s bill were to pass, all this would become a de facto mandate because any company that simply tries to operate profitably would end up getting hauled into court by some malcontent employee or shareholder.

If you need a “federal charter” to do business, then the manner in which you do business will ultimately be determined by the federal government.

Now, you might think, this bill could never pass. And with the current Congress and the current president, you’re right. It couldn’t. But Republicans will not always control Congress, and Donald Trump will not always be president. Ideas like this have a way of germinating until Democrats get the numbers they need. That’s what happened with ObamaCare. Don’t be so sure they wouldn’t do this too, if and when they think they can.

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